Business

The task force of the Accounting Standards Board dealing with urgent issues has released its guidelines on accounting for post-retirement benefits aside from pensions. The Urgent Issues Task Force has arrived on an agreement that other post-retirement benefits are liabilities and as such, should be accepted in financial reports. It was also agreed on that the principles of Statement of Standard Accounting Practice No. 24 (SSAP 24) are usable to the measurement and disclosure of such benefits. However, the measurement of such burden may create problems aside from those applying in the case of pensions. In view of this, a transitional period is given as an allowance before making it compulsory to apply SSAP 24 principles to the measurement of all post-retirement benefits. Also, UK subsidiaries may use the Financial Accounting Standard No 106 instead of the SSAP 24. SSAP 24 principles are to be applied to all post-employment benefits on accounting periods ending on or after Dec 23, 1994.

Tagging along with the other standard-setters: earnings per share presents a great opportunity for worldwide harmonisation

Article Abstract:

The UK Accounting Standards Board (ASB) decided to address the issue of accounting for earnings per share in response to the actions already taken by other standard-setting bodies on this topic. The board released a discussion paper in May 1996 that was closely patterned after the exposure draft developed by the International Accounting Standards Committee (IASC) and solicited for comment. The IASC, along with the US Financial Accounting Standards Board, has since announced their standards for computing and disclosing earnings per share. In light of these steps towards harmonization, the ASB should embrace the requirements as well as the provisions of the IAS No 33, and include them in the Financial Reporting Exposure Draft No 16. Earnings per share are proposed to be assessed in terms of the weighted average number of ordinary shares outstanding.

Financial Reporting Standard No 1: Cash Flow Statements

Article Abstract:

The Accounting Standards Board's first Financial Reporting Standard (FRS), 'Cash Flow Statements', sets standards for the reporting of corporate cash flow. The main objective of the FRS is to make companies report their cash generation and absorption on a standard basis. Certain sections of the FRS are discussed, including the statement of standard accounting practice, compliance with international accounting standards, explanation of the FRS, and the development of the standard.